back Back

The spreadsheet challenge as banks move processes to European financial centres in preparation for Brexit

Banking sector, Brexit, ClusterSeven, Digital Transformation, Europe, Lloyds Bank Group, Spreadsheets, UK

December 21, 2018

  • Banking sector
  • Brexit
  • ClusterSeven

Henry Umney, CEO, ClusterSeven

Uncertainty around Brexit continues, but practical preparations have begun – many banks are now well in the throes of duplicating or moving systems and business processes from London to other financial hubs.

Extricating processes isn’t going to be an easy task. There are two aspects to this separation process – formal IT supported enterprise systems and the grey IT (or end user supported IT systems). Most banks have the understanding and the ability to effectively disentangle the core enterprise systems. Where in this extrication activity, banks are likely to come unstuck is situations wherever there are end user supported IT, commonly Microsoft Excel spreadsheet-based processes, that are deeply linked with the rest of the banking group’s enterprise systems.

If a bank is required to set up a separate entity in the UK, all the data residing in ancillary spreadsheets that feed data into the various systems pertaining to this jurisdiction will need to be delinked/duplicated and housed separately too. For instance, as banks separate their Treasury operations, there will likely be certain processes that heavily rely on common Bloomberg and Reuters market feeds that are owned by or have deep linkages to the banking group’s systems. Similar issues will arise for capital modelling-related processes. While previously a bank might be evaluating business risk based on its aggregated position across its European operation, post-Brexit, determining the UK entity’s risk position will require the financial institution to disconnect and separate the relevant data for this jurisdiction.

Essentially, as banks duplicate their enterprise systems for specific jurisdictions, they need to do the same for the spreadsheet-based application landscape that they rely on operationally.

Disentangling these unstructured, but business-critical processes manually will prove impossible and eye-wateringly costly.  Typically, spreadsheets surround the core systems such as accounting, risk management, trading, compliance, tax and more. Complete visibility of the spreadsheet-based processes landscape is essential to identify the ones that need to be duplicated/extricated for the new entity, but due to the uncontrolled nature of spreadsheet usage, there will potentially be 1,000s of such interconnected applications and no inventory of these processes.

Banks should consider adopting an automated approach to safely extricating their spreadsheet-based processes. Spreadsheet management technologies, can scan and inventory the entire spreadsheet landscape, based on very specific complexity rules and criteria. The technology can expose the data lineages of individual files across the spreadsheet environment to accurately reveal the data sources and relationships between the applications.

This approach is already proven in M&A type operational transformation situation, which to some extent resemble the Brexit scenario. Aberdeen Asset Management adopted this approach to separate the Scottish Widows Investment Partnership (SWIP) when it bought the business from Lloyds Banking Group. Due to the number of convolutedly connected spreadsheets across the vast spreadsheet landscape and the complexities of the business processes residing in this environment at SWIP, manually understanding the lay of the land was unfeasible. Utilising spreadsheet management technology, SWIP inventoried the spreadsheet landscape, identify the business-critical processes, and pinpointed the files that required remediation. Simultaneously, the technology helped expose the data lineage for all the individual files, revealing their data sources and relationships with other spreadsheets. SWIP was able to securely migrate the relevant business processes to Aberdeen Asset Management and where necessary decommissioned the redundant processes.

Post-Brexit too, banks have a lot more to gain from automated spreadsheet management.  Spreadsheets will likely be the used to set up temporary business processes/solutions for the new operations. Spreadsheet management will embed best practice-led use of these tools across the lifecycle of such applications – from creation through to remediation and decommissioning into formal IT supported applications– encompassing spreadsheets and their unique data flows. It will also offer banks an in-depth understanding of their data landscape. This will help institute data controls and spreadsheet change management processes so that there is complete transparency and an audit trail tangibly reducing operational, financial and regulatory risks caused by spreadsheet error.


By Henry Umney, CEO, ClusterSeven


About the author

Henry Umney is CEO of ClusterSeven. He joined the company in 2006 and for over 10 years was responsible for the commercial operations of ClusterSeven, overseeing globally all Sales and Client activity as well as Partner engagements. In July 2017, he was appointed CEO and is strongly positioned to take the business forward. 

Previous Article

December 01, 2018

Accenture to enhance core banking platform with SEC Servizi acquisition

Read More
Next Article

January 07, 2019

The Danish startup putting the killing blow into key encryption technology

Read More

IBSi News

CloudPay, Nuvei, Payments, Montreal, Employee payments, Transactions, Partnership, London, UK, Mastercard Send, APAC,

July 12, 2024

Banking sector

Nuvei and Mastercard team to enable crypto to fiat conversion

Read More

  • Daily insightful Financial Technology news analysis
  • Weekly snapshots of industry deals, events & insights
  • Weekly global FinTech case study
  • Chart of the Week curated by IBSi’s Research Team
  • Monthly issues of the iconic IBSi FinTech Journal
  • Exclusive invitation to a flagship IBSi on-ground event of your choice

IBSi FinTech Journal

  • Most trusted FinTech journal since 1991
  • Digital monthly issue
  • 60+ pages of research, analysis, interviews, opinions, and rankings
  • Global coverage
Subscribe Now

Other Related Blogs

July 11, 2024

AI in Accounting: Moving Beyond the Hype

Read More

July 10, 2024

When cyber criminals log in, but don’t break in, is your data still data secure?

Read More

July 05, 2024

From self-governance to sustainable growth: how the SRO-FT empowers India’s FinTech revolution

Read More

Related Reports

Sales League Table Report 2024
Know More
Global Digital Banking Vendor & Landscape Report Q2 2024
Know More
Wealth Management & Private Banking Systems Report Q2 2024
Know More
IBSi Spectrum Report: Supply Chain Finance Platforms Q4 2023
Know More
Treasury & Capital Markets Systems Report Q1 2024
Know More